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Battle Lines Are Drawn in Wisconsin Over Proposed Property-Tax Change

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Wisconsin political leaders are girding for a crucial legislative battle over a proposed constitutional amendment that would eliminate local property taxes as a source of school funding.

The bill--which is championed by Democratic lawmakers and opposed by the Republican governor--would end the annual collection of some $1.7 billion in local school taxes by the year 2000. Although the proposal does not specify how those funds would be replaced, its backers say their aim is to force the state to make up the difference.

The legislature passed the measure last spring in a move that drew little attention. State law requires that it be passed a second time before it can be placed on the ballot for voter approval.

The leaders of the Assembly and the Senate agreed last month to postpone action on the bill until spring to allow lawmakers and the public to carefully consider its ramifications. That decision ensures that the proposal will not appear on the ballot until 1990 at the earliest.

All states except Hawaii, which operates a single statewide school system, require communities to levy property taxes to support their schools. The National Education Association estimates that Wisconsin schools obtain 55.2 percent of their funds locally, compared with the national average of 44 percent.

Leaders from both political camps agree that the state's property taxes are too high and that school districts are overly reliant on them. Prior efforts to address the problem, however, have been defeated amid partisan infighting.

Democratic lawmakers say they decided to press for the constitutional change because Gov. Tommy G. Thompson had vetoed several tax-relief proposals and had failed to develop a plan of his own.

The Republican Governor, meanwhile, argues that Democrats last year rejected his plan to pare local tax bills, and claims that they are trying to use the issue for political gain. Assembly Speaker Thomas A. Loftus, one of the amendment's chief proponents, is expected to challenge Mr. Thompson in the 1990 gubernatorial election.

Stephanie Case, an aide to Mr. Loftus, said the Governor had vetoed five property-tax-relief and cost-control measures in the past two years. She also said he vetoed an early-retirement plan for teachers that would have cut districts' costs.

"He is aligned with the business community, which objects to early retirement for teachers" because it fears that its employees would seek similar treatment, said Ms. Case.

Mr. Loftus, she said, favors 100 percent state funding for public schools.

Jonathan Henkes, spokesman for Mr. Thompson, called the proposed constitutional amendment "an absurd idea" that would force substantial increases in state taxes, such as the doubling of the sales tax.

Mr. Henkes said the Governor is committed to increasing the state's share of district revenues by 50 percent. But, he added, that goal is elusive because districts' costs have been increasing so rapidly that the state cannot keep pace.

Mr. Thompson has said the increase in local spending is due to teachers' unions winning too many favorable arbitration rulings in salary disputes. Mr. Henkes said the Governor plans to introduce legislation this session to change the state's mediation and arbitration procedure to hold salary increases to the rate of inflation.

Mike Brennan, director of government relations for the Wisconsin Education Association Council, expressed amusement at Mr. Thompson's plan. He noted that the Governor offered a similar proposal last year and then vetoed a compromise version.

"It's amazing that he's blaming us when he vetoed the bill," said Mr. Brennan. He also said that tying teachers' raises to the inflation rate was unfair, adding that that few politicians broached that idea when the inflation rate was in double digits and teachers were receiving 5 percent raises.

The union endorsed the proposed constitutional amendment during last year's session. However, Mr. Brennan said, the group would like to see the state impose and collect a statewide property tax.

Mr Brennan speculated that the Democrats were using the proposed amendment as "a political hammer" to force Mr. Thompson to take action.

"I think they will pass it if he doesn't come up with some type of property-tax relief for the state," he said.

Herbert J. Grover, the state school superintendent, said he opposed both the Governor's and the legislature's plans.

He called the proposed constitutional amendment "a draconian measure" that would "radically alter the history of education in this state." He said he also opposed the change in the mediation law, noting that it had helped avoid teacher strikes.

Mr. Grover has proposed that the state increase its share of local education costs to 66 percent, a move that would permit reductions in local property taxes and add $383 million to the state's education budget.

The state chief said he feared that voters would approve the amendment out of frustration if the legislature placed it on the ballot.

"I think we're on a collision course on this issue that will demand legislative and executive responses," he said. "Read my lips. This issue isn't going away."

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